Bills the Pirates of the NFL (new ESPN article)

[Thurman#1]

From what I have seen the NFL as a whole has received roughly in the neighborhood of $31 BILLION since 1998 through next year 2011. That money alone is enough to pay every player/coach/gm and put money in the owners pocket. The Bills could move to Elmira and they would still get the same amount as if they were in LA from the league. Ticket sales, merchandise, consessions, etc goes into the owners pockets, that's all. Ralph whines and cries because the Jones and Snyders of the NFL are getting more than him, Wwhhaaa.

 

Then for everyone to throw out there they need to be more visable, more marketing (Canada) and not viable enough or they are going to move is a crock. It's just all about making more and more and more money for the "NFL". It's not about competing like they say.

 

Why do you think they still have the blackout rule? Because every ticket sold means more money for the owners. To still have that rule is just a greedy example of how corrupt the NFL has become.

 

 

What are you talking about?

[BuffOrange]

Far be it for me to defend Ralph, but I do feel he is more incompetent than dumb. They were too stupid to realize Jabari Greer could play CB, so they drafted McKelvin. They could've traded down in that draft and used the saved $ not spent on the 11th pick to pay Greer. They could've said goodbye to worthless dead weight like Chris Kelsay and re-signed Fat Pat. Note that there was a time when presented with similar cost benefit analysis, the Bills generally made better either/or decisions (lets re-sign Eric Moulds and let Marcellus Wiley walk, for example). Good players leave teams via FA - it doesn't just happen to us. People here in Philly complain about the same thing, but unlike the Bills they know when to pull the plug, and they know which players on their team suck, and they draft better replacements.

Edited August 23, 2010 by BuffOrange

[Ghost of Rob Johnson]

Disturbing article from ESPN on the Pirates.

 

Basically, the ownership is quite content to field miserable teams as long as they can generate the cash flow to make $20 million distributions to team owners.

 

This really makes you think when re-reading Mark Gaughan's article about the Bills ranking dead last in 2009 cap spending and 8th from last in terms of cash outlays.

 

From 1960 to 2010, Ralph Wilson's ownership interest in the Bills has grown by nearly 25% per year -- from $25,000 to a fair value of $900 million. This investment income far surpasses whatever current revenue is generated by big market cities from PSLs, luxury boxes, and other factors. Yet, rather than spend some of this money, the Bills -- like the Pirates -- seem content to generate profits rather than field a competitive team.

USA today chart has them 12th overall last year in total spending.

 

http://content.usatoday.com/sports/football/nfl/salaries/totalpayroll.aspx?year=2009

[SuperKillerRobots]

Disturbing article from ESPN on the Pirates.

 

Basically, the ownership is quite content to field miserable teams as long as they can generate the cash flow to make $20 million distributions to team owners.

 

This really makes you think when re-reading Mark Gaughan's article about the Bills ranking dead last in 2009 cap spending and 8th from last in terms of cash outlays.

 

From 1960 to 2010, Ralph Wilson's ownership interest in the Bills has grown by nearly 25% per year -- from $25,000 to a fair value of $900 million. This investment income far surpasses whatever current revenue is generated by big market cities from PSLs, luxury boxes, and other factors. Yet, rather than spend some of this money, the Bills -- like the Pirates -- seem content to generate profits rather than field a competitive team.

 

I got news for you: The only way he can use that $899,975,000.00 is if he sells the team or takesa loan out against it. It's all about cash flow, not team value. Your team could be valued at $1 trillion, but only bring in $100 million in revenues per year, which would put it well below what the Bills take in annually and there fore you would not be able to pay players, coaches, etc to the same extent the Bills can with their relatively low (for an NFL team) cash flow.

[PNW_Bills_Fan]

This is all business. HE has payed the players that deserved it and were in their plans. When we were winning he payed for those guys to stay around. It is smart to not over pay for players.

[Gabe Northern]

I got news for you: The only way he can use that $899,975,000.00 is if he sells the team or takesa loan out against it. It's all about cash flow, not team value. Your team could be valued at $1 trillion, but only bring in $100 million in revenues per year, which would put it well below what the Bills take in annually and there fore you would not be able to pay players, coaches, etc to the same extent the Bills can with their relatively low (for an NFL team) cash flow.

 

How difficult is it to get a secured loan against an NFL franchise that you own outright? You think it would be difficult to get revolving line of credit to pay expenses against a $900 million fair value asset on which you have no debt? Don't like debt? Sell 10% of the team for cash to reinvest.

 

The statement of cash flows includes cash flow from financing activity, making the net asset value very relevant here.

 

The lengths people will go to defend Ralph is staggering. Someone with 40 years of cumulative annualized returns of 25% is not trapped in an illiquid position living hand-to-mouth. The current income earned by the family from the team's profitability is an insult considering how much they've made in capital gains. Get liquid. Spend it.

 

I got news for you: The only way he can use that $899,975,000.00 is if he sells the team or takesa loan out against it. It's all about cash flow, not team value. Your team could be valued at $1 trillion, but only bring in $100 million in revenues per year, which would put it well below what the Bills take in annually and there fore you would not be able to pay players, coaches, etc to the same extent the Bills can with their relatively low (for an NFL team) cash flow.

 

By the way, I love the "I got news for you" insult to start the post.

 

Equity extraction via new debt is one of the most common financing transaction in the United States. This is not only true in the home equity context (cash-out refis) but also true in businesses, whether public, closely-held, or private. Companies targeting capital structures use leveraged dividends, family businesses take on debt to "cash out" to allow family members to diversify into stocks, other businesses manage liquidity levels by using company assets as collateral for credit lines.

 

The focus on cash flow given the circumstances here is just plain stupid.

[Lurker]

This really makes you think when re-reading Mark Gaughan's article about the Bills ranking dead last in 2009 cap spending and 8th from last in terms of cash outlays.

If all it took to be a successful playoff team was $10-$12 million in additional payroll, the Redskins would be the reigning SB champs every year...a concept that never seems to register with a disappointingly high proportion of this board's membership, or media members who know better--but expound on the point anyway in order to attract page clicks.

[FreakPop]

What are you talking about?

 

Yeah, my bad. I was at work trying to type fast and not get caught and trying to do 10 things at once.

 

The $31 Billion is from the television deals the NFL has negotiated since 1998. That's roughly $1 billion per team over the last 12 years. Why isn't every team spending to the cap every year?

 

That's just tv money, then there is ticket sales, concessions, merchandise, sponsors, etc. This league and it's owners have so much money coming in it's sickening. Then for a team to hold a city and it's fans hostage if, say a new stadium is not built or having the blackout rule is ludicrous.

Edited August 23, 2010 by FreakPop

[Ignatius J. Reilly]

I initially thought this post was actually about pirates, and I'm disappointed to find out it is about some organized sporting venture. I despise athletes and athletics.

 

However, I have often dressed up as a pirate, and was once is a swordfight. I tried to end our little duel. I called out pacifying words; I entreated; I finally surrendered. Still Clyde came, my pirate costume so great a success that it had apparently convinced him that we were back in the golden days.

[BADOLBILZ]

Truthful. The Pirates are a MLB farm team. Year after year, they consistently sell off a complete starting roster of MLB players. While the Bills have let go of some players who have went on to succeed elsewhere, I can't say that the Bills have had 10 players in the past decade that fall into this category:

1. Winfield
2. Pat
3. Clements
4. McBadknee
5. Dockery? Maybe?
6. Leonhard (Switch to 3-4 benefitted him)
7. Bannan (Switch to 3-4 benfitted him)
8. Henry? before suspension and fathering 10 more kids?
9. Bledsoe? does one half good season at Dallas count enough?
10. I'm stuck right here, and I stretched for four of the guys (Bannan and the 3 ?'s)

 

Think a little harder. How about:

 

Jason Peters

London Fletcher

Jabari Greer

Lawyer Milloy

 

Then you even have swaps gone bad like letting Ruben Brown go in favor of Chris Villarial and Takeo Spikes in favor of Ellison. While they were cost cutting moves they resulted in poorer play from those positions.

 

Teams like the Steelers let FA's walk and replace them with players of simialar or better quality. Often with later round picks. The best the Bills can do is try to replace the player they are losing with that years first round pick.

 

They aren't exactly like the Pirates, but they are probably the closest thing the NFL has to it in terms of not retaining their own talent. A handful of teams draft worse than the Bills, but you would be hard pressed to find an NFL team that has allowed as many quality players to leave or be traded the past decade.

[Wagon Circler]

Sounds like people are finally realizing that this team is being setup for a sale and not for a playoff run. The argument that you dont invest much money in something that you fully intend to sell is right on.

 

The real discussion should be about what happens after a sale. I still argue that no business people in their right mind (local or not) will invest over $900 million in WNY at an avg of ~$55 a ticket. The team will be sold and will operate in WNY for about 3-5 years afterwards. In that time prices (on everything) will skyrocket, the team will continue to lose, the fan base will diminish, and the team will move.

Kind of what happened with the Buffalo Braves.

[Over 29 years of fanhood]

The owner is very important in this equation. But to suggest the state of the organization is bottom line driven is not rational. Firstly, I have been around a number of rich executive personalities and an almost uniform trait is a big EGO. Of course these guys are going to make money, but they are not going to sit on their wallet if it comes between spending and winning, because winning is ingrained in their being.

 

If the assertion is RW knows keeping spending down will lead to a losing team but accepts that for net profit, that is flat out wrong. Why even own a sports team? Sell it to LA cash out and roll in your money…

 

However if the argument is RW thinks he can build a smarter team by winning while keeping costs low, then maybe. But this fantasy that he is Mr. Burns in behind a large desk saying "keep losing" while smiling and ringing the register is non sense.

 

 

 

 

 

[C.Biscuit97]

1) The payroll of the Super Bowl Bills would be one of the highest in NFL history.

 

2) What do OJ, Kelly, and Bledsoe have in common? They were all the highest paid players in the league at one point and all played for the Bills.

[apuszczalowski]

How difficult is it to get a secured loan against an NFL franchise that you own outright? You think it would be difficult to get revolving line of credit to pay expenses against a $900 million fair value asset on which you have no debt? Don't like debt? Sell 10% of the team for cash to reinvest.

 

The statement of cash flows includes cash flow from financing activity, making the net asset value very relevant here.

 

The lengths people will go to defend Ralph is staggering. Someone with 40 years of cumulative annualized returns of 25% is not trapped in an illiquid position living hand-to-mouth. The current income earned by the family from the team's profitability is an insult considering how much they've made in capital gains. Get liquid. Spend it.

 

 

 

By the way, I love the "I got news for you" insult to start the post.

 

Equity extraction via new debt is one of the most common financing transaction in the United States. This is not only true in the home equity context (cash-out refis) but also true in businesses, whether public, closely-held, or private. Companies targeting capital structures use leveraged dividends, family businesses take on debt to "cash out" to allow family members to diversify into stocks, other businesses manage liquidity levels by using company assets as collateral for credit lines.

 

The focus on cash flow given the circumstances here is just plain stupid.

Sure it might be easy to get a loan on that money, but you have to understand that the money does have to be paid back right? In order to do that, the Bills would then have to bring in what they do now, plus what they have taken out in a loan. its also not so easy to get people to invest into your "buisness" without being able to show them that they will not only make their money back, but get a nice return on their investment in order to do it. How easy do you think it is to get people to invest millions in a small market that is struggling right now?

 

Why would a 90 year old man with a buisness thats making little profit compared to its total value, be willing to go further into debt? its not like he needs the money, and right now he can keep the team at an affordable level to the fans and not need to charge comparible amounts to most other teams to survive

[BillsVet]

1) The payroll of the Super Bowl Bills would be one of the highest in NFL history.

 

2) What do OJ, Kelly, and Bledsoe have in common? They were all the highest paid players in the league at one point and all played for the Bills.

 

No one's talking about the 70s, 80s, 90s, or early 00s era Bills. We're analyzing if the Bills and by virtue, RW, are now content with a profitable franchise that is sub-par to poor on the field now. And right now, it seems RW is packing it in, hiring strictly people he knows for GMs and preparing for the inevitable.

[ieatcrayonz]

And we still can't see ESPN's true agenda.

[notwoz]

Sure it might be easy to get a loan on that money, but you have to understand that the money does have to be paid back right? In order to do that, the Bills would then have to bring in what they do now, plus what they have taken out in a loan. its also not so easy to get people to invest into your "buisness" without being able to show them that they will not only make their money back, but get a nice return on their investment in order to do it. How easy do you think it is to get people to invest millions in a small market that is struggling right now?

 

Bingo

[C.Biscuit97]

No one's talking about the 70s, 80s, 90s, or early 00s era Bills. We're analyzing if the Bills and by virtue, RW, are now content with a profitable franchise that is sub-par to poor on the field now. And right now, it seems RW is packing it in, hiring strictly people he knows for GMs and preparing for the inevitable.

 

It's all about the QB. If the Bills and Colts switched QBs, we make the playoffs every year instead of the Colts.

 

We traded a 1st for RJ and Bledsoe (and paid them a lot of money) and traded up to get Losman (by a well respected NFL personnel guy). You can say the Bills can't scout QBs but to say tehy are cheap is just silly.

[Gabe Northern]

 

Why would a 90 year old man l value, be willing to go further into debt? ineeds the money, and right now he can keep the team at an affordable level to the fans and not need to charge comparible amounts to most other teams to survive

 

you are misstating things. The team has no debt. There is no risk of not getting repaid because any loan would be secured by the team. The issue is not him going into more debt but simply forgoing dividends. A $39 million operating profit is outrageous when the owner has made so much in capital gains. The point is that operating income in this circumstance is besides the point. It's like owning an apartment building that has increased in value 40,000 times over and saying you can't fix the plumbing because the rent isn't high enough.

Edited August 24, 2010 by Gabe Northern

[Sisyphean Bills]

How difficult is it to get a secured loan against an NFL franchise that you own outright? You think it would be difficult to get revolving line of credit to pay expenses against a $900 million fair value asset on which you have no debt? Don't like debt? Sell 10% of the team for cash to reinvest.

 

The statement of cash flows includes cash flow from financing activity, making the net asset value very relevant here.

 

The lengths people will go to defend Ralph is staggering. Someone with 40 years of cumulative annualized returns of 25% is not trapped in an illiquid position living hand-to-mouth. The current income earned by the family from the team's profitability is an insult considering how much they've made in capital gains. Get liquid. Spend it.

 

 

 

By the way, I love the "I got news for you" insult to start the post.

 

Equity extraction via new debt is one of the most common financing transaction in the United States. This is not only true in the home equity context (cash-out refis) but also true in businesses, whether public, closely-held, or private. Companies targeting capital structures use leveraged dividends, family businesses take on debt to "cash out" to allow family members to diversify into stocks, other businesses manage liquidity levels by using company assets as collateral for credit lines.

 

The focus on cash flow given the circumstances here is just plain stupid.

Cash flow is a very important metric when selling a business however.